16 minute read
PUTTING THE ‘WE’ BACK INTO POWER
from 2030 Magazine
Direct Air Capture is on everyone´s lips when it comes to the possiblity to have a real impact on reducing CO2 from our atmosphere, yet it is expensive..can we bring down the cost with investment from the global coporations? By Elizabeth Prosser
A BREATH OF FRESH AIR? IS IT A BREATH OF FRESH
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There was a time when the very mention of the word ‘power’ would evoke images of ugly old gas- and coal-fired power stations perched on windswept escarpments belching smoke and steam into the air like flatulent characters from a latter-day LS Lowry painting. Or the sinister curves of nuclear power stations, whirring silently but ominously on the edge of perpetually nervous coastal towns. But fortunately things have
changed a little over the last few decades.
As the need to develop cleaner, less dangerous and more sustainable ways of generating and managing energy has increased, and the cost of the technology involved has continued to fall, new players have gradually entered the fray. Gangs of industrial strength wind turbines for example, which, if we leave the politics of rural aesthetics to one side for the moment, are becoming a far more common view on those windswept escarpments. As are offshore wind farms (despite the protestations of a certain ScottishAmerican golf resort developer), small solar farms (yes, even in northern Europe), tidal energy installations (nothing to get nervous about there) and waste-powered biomass generators (where there’s muck, there’s brass).
But old dogs learn new tricks very slowly and the relatively small number of large and powerful energy companies responsible for generating and distributing the world’s electricity from their power stations to our front rooms, haven’t
exactly been biting our hands off to switch to 21st century technology. (Hydroelectric power generation being the only real exception, due perhaps to its single location, manly, large-scale, nature.)
Indeed the Energy Information Administration (EIA) in America estimates that only 11% of the world’s energy consumption currently derives from renewable energy sources (hydropower, biomass, biofuels, wind, geothermal, and solar) a figure which they reckon will only rise to a whoppingly disappointing 15% by 2040. the politicians of 2047 will be spouting lines like, “Don’t worry folks, something’s bound to turn up in the next few years,” and, “Still, there wouldn’t be much point owning a speedboat if we didn’t have regular floods now would there? What do you mean you don’t have one? Flood or a speedboat? Everyone has floods.”
People power…
Thankfully however, it is quickly becoming clear that technology has changed the rules of the games so significantly - in terms of both the hardware and the systems needed to efficiently implement that hardware - that we won’t have to wait for the large powergenerating companies to wean themselves off their addiction to fossil and radioactive fuels after all. People, if I’m allowed to bastardise a well-known Eurythmics lyric for the purpose, are doing it for themselves.
Yeah, sod it, why wait for the politicians and the power companies, burdened as they are by their financial responsibilities to their shareholders and their
2030 WHY MORE? & MORE OFTEN?
And while nobody seems to be pretending that setting up a community energy project isn’t without its challenges, the vast majority of the people who are getting involved are obviously happy they did.
“If you search for images of ‘community energy’ on the internet,” says Rachel Coxcoon, head of ‘Local & Community Empowerment’ at the Centre for Sustainable Energy, “there’s a local newspaper-type photo that’s emerging as a kind of standard. It’s of a group of happy people
surrounding their renewable energy installation, often waving their share certificates and looking jolly pleased with themselves. And so they should, since they have invariably laboured long, unpaid hours on top of full time jobs and family commitments to make their project a success.”
Such is the level of ground level enthusiasm to get on with the job of switching to clean renewable energy sources, rather than just talking about it. And even if, as some commentators are suggesting, these groups of people are more inspired by the prospect of cheaper energy bills and returns on their humble investments than the state of the “Broad community ownership of renewable energy in particular could go some way to transforming the distribution of wealth,” says Coxcoon. “Since some of the poorest areas have some of the best renewable energy resources. In fact, our energy use is perhaps the only issue that affects us all, which offers such enormous opportunities to generate and save money within local communities, and our elected representatives need to get their heads round that. Fast.”
Side benefits…
Aside from the obvious benefits to be gleaned from increased energy security, cheaper bills, and a more egalitarian division of profits, another less obvious benefit of locally managed energy projects is the positive effect they seem to be having on the communities they serve, bringing people together for a common cause.
The “let’s all get stuck in and bring to the table what we can” nature of the beast often leading to opportunities for younger members to learn skills from older more experienced participants (and vice versa perhaps when it comes to the transfer of knowledge about climate change). Insert quote here about the learning opportunities??
Getting projects off the ground…
If there is one common denominator in all the new community energy projects we are seeing cropping up round the world - be it a village run wind turbine in New Zealand, a solar panel installation on a school roof in England, or a community funded biomass generator in the Netherlands - is the presence of a single person, or a small group of people, who really want to make it happen. The catalysts of change.
“I think generally we were seen as completely barmy,” says Nicholas Gubbins, Chief Executive of Community Energy Scotland, which has helped launch dozens of successful community energy projects in the country since its formation in 2002. “There wasn’t a lot of theory or concept behind the idea, but in Scotland we have an incredibly well developed community infrastructure, with a very strong tradition of voluntary sector engagement. One of the major issues communities face is how the earn revenue to underpin their social purposes so we felt that renewable energy generation was a fantastic opportunity to bring in revenue to support
FLOODING HAS INCREASED 60% GLOBALLY
2030 as yet unrealised underground assets, to come to the table when all the know-how already exists for communities of like-minded people to get together to start harvesting their own clean power? From their own back yards. The official term for this, and one which you‘re likely to hear more and more over the coming years, is ‘community energy’. A concept which, according to a report released in January this year by the UK’s Department of Energy and Climate Change (DECC) entitled ‘Community Energy Strategy: People Powering Change’, is all about “many different types of community getting involved in energy issues in many different ways. Be it a group of local people setting up their own solar installation or wind turbine; a local authority leading a collective purchasing scheme to help local people get a better deal on their energy tariff; an energy advice session at a local community centre; or a whole range of other schemes.” (Bordering on platitude? Only time will tell,) And, like the tortoise of unfunded community action steadfastly marching past the slumbering hare of corporate power generation, it’s a concept which is fast gaining traction. And, most excitingly perhaps, not in a ‘one at a time’ sort of way, so much as all over the place all at the same time. From the craggy peaks of the Chilean Andes, past the rugged coasts of northern Scotland, to the sun-baked rooftops of the south pacific islands. As Joel Otero, a participant in a small solar project near Barcelona recently told me, “There’s near limitless free energy all around us, literally bombarding us from every angle; all we have to do is figure out a way to grab a hold of our slice of it. And frankly, we have the
2030 community based action and development. And also to save costs in many of the community facilities that need heating and energy and which could convert to renewable energy. Those were the driving forces for the idea of community energy development.” Once a possible scheme has been identified and the nucleus of a team with the determination to make it happen formed, the next logical port of call is usually the Local Authority, or government office. Certainly in terms of basic information, advice and help evolving some sort of business plan. If governments are good at anything, it’s theory and rhetoric. In some countries though they will also perhaps be able to offer access to loan funds or other forms of financial support to help get the ball rolling. But most importantly, depending on the country concerned, is the support they can usually provide negotiating (their own) usually complicated planning processes and an idea of how the project might best fit into (their) overall plans for that particular locality. “Finding your way through the complicated maze of planning requirements can be enough to stop many community projects in their tracks,” says Michael O’Keefe, an independent renewable energy advisor based in County Kerry in Ireland. “But there are plenty of people like me around who know the ropes and how to convince the various planning bodies that the proposed project is not ony feasible in a technical and financial sense, but that it also has the backing of the wider community in which it will be based.” For more grandiose projects, the large energy companies, particularly those with a proven record in renewable energy installations, are also worth contacting. Many of them actively encourage approaches from local communities keen to buy clean, renewable energy from a local source. Local, part ownership evidently being one of the best antidotes to planning objections. As has been the case in countries with high levels of community ownership such as Germany and Denmark, where on-shore wind turbines don’t attract nearly as much ‘Not in my back yard’ (NIMBY) criticism as they do in countries such as the UK. “When I look up at the turbines on a nice windy day,” says Roland Muller, a freelance illustrator based in southern Germany, of the small wind farm located on a windy escarpment a few miles from his house, “all I see is money being shaved off my electricity bill. As do my neighbours as most of us own a share in them. Plus I know that it is good for the environment. All in all a beautiful sight not an ugly one.” It’s not what you know, but who you know… The next logical step in the evolution of the project is the formation of useful partnerships. Partnerships with local authorities, commercial organisations, universities, local knowledge networks. Anyone who has ‘been there and done it’. “You’d be surprised how much local knowledge you might have lurking in your community,” says O’Keefe. “Particularly in rural areas, which are home to commuting professionals. I recently helped realise a 30kw solar installation on the roof of a rugby club in a small village just outside Dublin and when we toldthe club’s membership about the plan it turned out we had access to 2 architects, an electrical engineer, a local councilor and a fully-qualified solar panel installer. To name but a few, all of whom were only too happy to get involved as volunteers, because they saw it as a chance to do something for their community. At the end of the day, your greatest local asset is often your people.”
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The sordid issue of cash…
As anyone who has ever considered saving money by replacing all their electricity-hungry light bulbs at home with far more efficient LEDs will know, once you’ve done all the research and developed your game plan, the next major barrier to doing the sensible thing is usually cash. The same applies to most community energy projects.
According to a report in the Guardian newspaper in the UK last year, the world needs to find $1tn a year of clean energy investment if we are to have any chance of avoiding runaway climate change. Last year we collectively managed just $254bn.
Europe, often cited as one of the more advanced parts of the world when it comes to renewable energy investment, saw a worrying slump in investment of 41% in 2013 to $58bn.
Some countries it would seem, take the whole business more seriously than others. Sweden for example, derives 51% of its energy from renewables, while Austria and Denmark also seem to be paying heed to the warnings with 32% and 26% respectively. The larger economies fare less well though with Italy posting a score of just 14%, France 13%, Germany 12% and the UK, as rich as it is in all forms of natural energy, just 4%. (A figure that would have slumped even further if Scotland had voted to leave the Union last month.)
With banks still seemingly unwilling to prise open their coffers for renewable schemes of any size, let alone small scale community projects, a far more common source of funding these days are what are known as ethical community lending schemes, whose charters require all the projects they fund to pass basic criteria tests in terms of their social and environmental impact. Organizations such as Ethex in the UK, whose stated remit is to “make positive investing easy to understand and do,” while providing “a direct and personal way for individuals to invest in businesses they believe in.” Which in a nutshell encapsulates a whole new approach to investment, particularly on a local level, which works on the basic tenet that a sufficiently large proportion of investors care as much about the ethics of their investment as their profits. (Hark, is that the sound of bankers scratching their heads in puzzlement?)
The role of the crowd…
All of which is essentially an extension of the concept of crowdfunding, whereby the catalysts behind a project, rather than going cap-in-hand to the local bank and jumping through countless hoops to prove their worth, instead appeal directly to their local community.
Indeed, while ethical funds such as Ethex and more traditional pensions and investment funds will be increasingly important in the future, in many countries crowdfunding is proving to be the potential savior of many community energy projects.
For example a quarter of Germany’s electricity comes from renewable sources (as opposed to its total energy, which is 12%) the main reason being that nearly half of its renewable energy capacity is owned by individuals, community groups and private developers. They have collectively managed to leverage tens of billions of euros in the last two decades to bring about what is essentially an energy revolution.
of its total energy from renewables, on a good day can produce more than they need and are able to sell their surplus to the perpetually hungry European grid. A huge contributing factor being legislation, which requires commercial wind developers to offer at least 25% of every project to the local community.
In America, the country’s largest solar power provider recently forecast that crowdfunding will generate $5bn of investment for
rooftop solar projects in the next five years.
A May 2014 report in the UK by the independent think tank ResPublica and the energy supplier Cooperative (who pledge to source electricity with a carbon content of less than half the national average) entitled ‘Community Energy: Unlocking Finance and Investment’, set out how crowdfunding could be used to bring about a community energy revolution in the UK.
At the time of the report Cooperative Energy had in place six purchasing agreements with community energy groups and strategic partnerships with community energy crowdfunding sites such as Abundance Generation and community energy facilitators such as The Resilience Centre.
However, the general concensus in Europe and the rest of the world, and one which is echoed in the Unlocking Finance report, is that governments and their respective financial service regulators need to broaden their view on risk, and
by adopting a longer term view on investment proposals, play a more proactive role in facilitating far more diverse financial sectors. Thereby allowing smaller but more innovative players such as crowdfunding platforms and peer-to-peer initiatives to expand their influence in the community energy sector.
Many analysts are also calling for governments to introduce real tax incentives to investors in community businesses, such as the Social Investment Tax Relief (SITR) scheme launched in the UK last year. The rules governing the sort of tax-free saving schemes common in most developed countries these days could also be opened up to include the debt-based securities offered by peer-to-peer lenders.
The bottom line being that there is very significant ground level support around the world for renewable energy generation, and in particular for community energy projects that have a direct effect on the well being of local people. And that the key to unlocking that support in terms of providing the billions of dollars, pounds, euros, yen, roubles,
rand, francs and yuan needed to bring about real and immediate change, lies in the crowd.
As the UK’s minister for climate change, Greg Baker, recently said of the situation in the UK, “Crowdfunding could be an incredibly powerful way to deliver a decentralised energy system, and help achieve the goal of turning the ‘Big 6’ energy companies, into the ‘Big 60,000’.”
As the title of this article suggests, putting the ‘we’ back into ‘power’, both figuratively and literally.
